The International Maritime Organization (IMO) is making significant strides in its commitment to reducing greenhouse gas (GHG) emissions. This was evident during the recent meeting of the Intersessional Working Group on GHG Emissions (ISWG-GHG 19), which focused on mid-term GHG measures. Over the course of two days, the group examined the draft IMO Net-Zero Framework, designed to meet the ambitious targets outlined in the 2023 IMO Strategy on GHG Emission Reduction from Ships.
One of the key developments was the introduction of a tiered GHG Fuel Intensity requirement system. This proposal mandates vessels to achieve a direct compliance target for their GHG intensity, or to balance any non-compliance using a system of purchasing or transferring compliance units. Notably, the proposed framework eliminates a previously suggested flat rate contribution as the main economic mechanism.
Additionally, the text proposes mechanisms for transferring and banking surplus compliance units, along with the creation of an IMO GFI Fund to oversee the financial aspects of the scheme. The proposed framework sets the stage for data collection starting on January 1, 2028, with the first verification and compliance assessment occurring in 2029. However, discussions regarding compliance unit costs remain ongoing, with various proposals still under consideration.
Ships will be expected to progressively reduce their GHG intensity until 2050, with surpluses available for transfer or cancellation, while those falling short will need to acquire surplus units or pay for remedial ones. Despite the advancements, achieving consensus among Member States presents a formidable challenge. Several contentious issues remain, including the potential economic contribution or levy, specific reduction paths, and pricing for remedial units.
Small Island Developing States (SIDS) have also expressed their concerns regarding the proposals. The MEPC 83 meeting scheduled for April 7-11 will be critical as Member States attempt to negotiate an agreement. The goal is to finalize regulations at a special session of the MEPC in October 2025, with the measures potentially taking effect in March 2027.
As the discussions continue, the maritime industry must prepare for substantial shifts in fuel choices, technology adoption, and operational practices as these mid-term measures move toward implementation.